Where Did You Metal?

This is a question some 2.2 million Americans can ask each other according to a brief issued by Health and Human Services (HHS) on January 13, 2014. This statistic represents the total number of newly insured Americans for the period October 1 to December 28, 2013. When enrolling in “ObamaCare,” individuals have their choice of plan levels; Platinum, Gold, Silver and Bronze. As the metals progress in value, so does the cost to the patient and coverage. Coverage will range from 90% of medical expenses for Platinum to 60% for Bronze plans, in a scaled 10% decrease by metal.

Regardless of the plan selected, the Affordable Care Act requires each to provide 10 Essential Health Benefits. These are defined as:

1. Ambulatory patient services (care you receive as a “walk-in,” rather than services received as an inpatient at a hospital or care facility)2. Emergency services3. Hospitalization- Medically necessary surgeries and other inpatient procedures4. Maternity and newborn care5. Mental health services and substance use disorder services (counseling and treatment)6. Prescription drug coverage7. Rehabilitative and habilitative services and devices8. Laboratory tests and services 9. Preventive and wellness services and management of chronic diseases10. Pediatric medical services to include ancillary services, such as oral and vision care.

Insurance companies are only required to offer Silver and Gold plans. A 5th plan, labeled a Catastrophic Plan, is available to individuals who cannot afford the Bronze Plan. This plan is available through an insurance exchange and tax subsidies cannot be used to reduce its premiums. According to the HHS brief, enrollment by Marketplace plan is as follows:

• 20% Bronze• 60% Silver• 13% Gold• 7% Platinum• 1% Catastrophic

The brief goes on to outline that 79% of persons who have selected a Marketplace plan have selected a plan with financial assistance. With that understood, we can’t help but be concerned about how these newly insured patients will pay high deductibles and co-pays associated with receiving their care. Further unease is likely being felt by insurance companies, who have not seen the expected demographic mix of customers buying plans.

According to Federal statistics, young Americans (ages 18-34) account for 40% of all uninsured. Enrollment by this demographic is key to allow carriers to balance out the insurance risk pool. This is not what we are seeing as detailed in the HHS brief. According to the brief, of those enrolled:

• 6% are under age 18• 9% are ages 18-25• 15% are ages 26-34• 15% are ages 35-44• 22% are ages 45-54• 33% are ages 55-64

With only 24% of enrollees being between ages 18-34, insurance companies and the Federal Government are hoping to see a flurry of enrollment by this demographic in the months to come. Lack of their increased participation will lead to higher than expected costs to the carrier. As we know, when costs are increased, insurance companies will look to either decrease costs by cutting payment or increasing revenue through higher fees to the patient or requesting increased funding from the Federal Government. APS will continue to monitor this expansion of coverage. If you have additional questions, please contact your Account Manager.